Interferons and cytokines play critical roles in the initiation and promulgation of chronic inflammation. Their participation in the pathogenetic mechanism of several autoimmune diseases is well established. One of the more important processes in chronic immune inflammation is cell mediated immunity, of which the primary cell type is the monocyte/ macrophage. By way of its wide variety of soluble secreted mediators, the macrophage becomes an important player in mediating TH1 type responses. One of the predominant cytokines characteristic of this response is interferon gamma (IFN gamma). The other T cell response, TH2, is characterized by secretion of cytokines such as IL-4 and IL-5. Clearly, understanding how these cytokines and interferons interact to modulate cell functions is critical to potential manipulations that would allow better control of chronic inflammation. We have focused on the interactions of IFNs and cytokines with peripheral blood monocytes and how these cells modulate the expression of various early response genes that we think are critical to maintaining chronic immune inflammation. We have shown that several genes are transcriptionally regulated by IFN gamma. The induction of these genes by IFN gamma can be modulated by cytokines such as IL-4 and can also be modulated by protein kinase C activators such as phorbol esters. We have gone on to characterize a complex of DNA-binding proteins that act as transcriptional enhancers by binding to a region of the promoter of the high affinity FcgammaRI gene. These complexes are recognized by electrophoretic mobility shift assays. We have used this system to further characterize the mechanisms by which IFN gamma activates macrophages. We have shown that a tyrosine kinase activity is essential for the activation of these transcription factors. We have gone on to show that a component of these factors is a 91 kDa protein that is tyrosine phosphorylated and is a common component of several IFN activated transcription factor complexes. These findings have important implications for the control of chronic inflammation.